Using a Salop circle model, this research analyzes the welfare implications of firm/product entry with information provision by consumers. While firms use consumer information to target sales efforts, consumers face privacy trade-offs when providing their personal information. We show that (i) price and profit first increase, then decrease with more varieties; (ii) consumer welfare, affected by price, sales effort, privacy loss, and matching effects, first decreases, then increases with firm entry; (iii) equilibrium information is socially optimal given the number of varieties; and (iv) if the variable cost of providing sales assistance is low (high), free entry leads to too much (few) varieties and too little (more) information, from a social welfare standpoint.

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Salop 型号的价格和品种

本研究使用萨洛普圈模型，分析了企业/产品进入以及消费者提供的信息对福利的影响。虽然公司利用消费者信息来进行销售工作，但消费者在提供个人信息时面临着隐私权衡。我们发现（i）随着品种的增加，价格和利润先上升后下降；(ii) 消费者福利受价格、销售努力、隐私损失和匹配效应的影响，随着企业进入先减少，然后增加；(iii) 考虑到品种的数量，均衡信息是社会最优的；(iv) 如果提供销售协助的可变成本低（高），从社会福利的角度来看，免费进入会导致品种过多（过少）和信息过少（过多）。